Generic Gains for Lannett

But there's an approach to making profits from this sector that doesn't rely on breakthrough discoveries, expensive drug trials, or constant cash infusions through dilutive public offerings to fuel its engine.

Welcome to the lucrative world of generics, which work in the same way as their more famous brand-name competitors.

Of course, before a company can legally sell generics, the patents on the target brand medication have to expire. Currently, a lot of brand drugs are going over the so-called patent cliff, and generics manufacturers are having a field day, making money hand over fist.

This year, 18 drugs will lose their patent protection. In 2015, only nine will. So the time to invest is now.

The challenge is in finding a stock that has established a strong track record but still has room to grow.

The big generics makers have already seen most of their upside, while micro-cap companies, on the other hand, are very risky. But there are a few companies that have recently enjoyed explosive expansion and are still moving upward. One is Lannett Co. (LCI).

Its current product portfolio includes about 25 compounds, all available in various strengths and order sizes, and 19 more product applications already pending at the FDA.

So even with the slowdown in patent expirations, Lannett should be able to nearly double its catalogue in the near future.

It isn't just Lannett's remarkable product portfolio that makes this company low-hanging fruit for investors—incredible financial performance is also in the mix.

Over the past two years, LCI's price per share has grown over 1,000%. Earnings have gone up for seven straight quarters, with the last showing a gain of 242%.

Performance has been so strong that Lannett has earned a 99 Composite and Relative Price Strength Rating for its industry—the highest possible.

With a current mid-range market cap of $1.71 billion, Lannett is in a great position to continue its expansion—and raise its valuation—through the foreseeable future. In short, it's a terrific opportunity for investors.